Sorry, you have not enabled Javascript for your internet browser, so some of our website's pages may not render as fully as intended.Please Click here for easy instructions on how to enable Javascript on your browser or consult your IT support staff for help.

A controversial drug arrest

You’d have to be pretty naïve about human biology to believe that drinking Red Bull really “gives you wings”. But the slogan still got the drink brand into trouble five years ago, when an American consumer sued its Austria-based owner. The man argued that after 10 years of downing the energy drink there was still no sign of any wings (or more specifically, the physical or mental boost that the message implied). Red Bull was forced to settle the case for $13 million, half of which went into a fund for small refunds for other American customers.

Over in China, millions of consumers are now wondering if one of the most advertised medicinal tonics has much medical value at all.

The product in question is Hongmao Medicinal Liquor. According to its Inner Mongolia-based manufacturer’s website, the tonic is derived from a secret formula passed on by the Qianlong Emperor to people living in Hongmao county in 1739. Now it is has gone national: the liquor is available at more than 200,000 drug stores and data from the China Food and Drug Administration suggests that Hongmao has put out a total of 1,192 TV and newspaper ads over the past five years promoting it.

Most of Hongmao’s TV commercials target elderly people, describing the product as an effective remedy for joint pain and cardiovascular diseases. According to Health Times, a publication under the People’s Daily, Hongmao has already been reprimanded 2,630 times since 2008 by various local governments and health authorities for violating the advertising laws.

ThePaper.cn also noted that Hongmao county was only established by the Inner Mongolian government last year, which means that some of the claims about its heritage could be misleading too.

These questions prompted a man called Tan Qindong, who runs a small pharmaceutical business of his own, to look into Hongmao’s medicinal value. In December he published his findings on weibo and accused the tonic of being “poison from heaven”. Tan also warned that the supposedly curative benefits of the 67 TCM (Traditional Chinese Medicine) ingredients claimed by Hongmao were unclear. He even thought some could be dangerous for elderly people.

Tan has a paltry following on weibo but Hongmao’s reaction was a a public relations blunder that has brought much wider attention to his original article.

In January he was arrested in Guangzhou by two police officers sent from Inner Mongolia and then imprisoned in the city of Liangcheng, where Hongmao is headquartered. He was finally released on bail earlier this month after a public outcry. Tan says he accepts that his use of the word “poison” was inappropriate but he has denied the charges of “malicious claims”, for which he will now stand trial. “Liangcheng’s local government naturally wants to protect the city’s most important enterprise,” ThePaper.cn wrote, noting that Hongmao paid Rmb350 million ($55.26 million) in local taxes last year, or about 86% of the fourth-tier city’s fiscal income.

Hongmao isn’t the only popular product that has seen its medicinal value questioned recently. A weibo post by the National Health and Family Planning Commission’s hotline service about ejiao – or donkey gelatin – also sparked national debate last month (see WiC400).

The nub of the problem, ThePaper.cn suggests, is that regulators have been struggling to define the medicinal value of many TCM products. So perhaps the upcoming lawsuit between Hongmao and Tan could serve as a landmark case in addressing some of the concerns about how they are marketed. The China Food and Drug Administration has lined up a group of TCM doctors and Western medicine professionals to look into the claims and the verdict could decide whether Hongmao, and many other heavily advertised products, will be marketed as more generic health tonics or as prescription TCMs.

The Week in China website and the weekly magazine publications are owned
and maintained by ChinTell Limited, Hong Kong. Neither HSBC nor any member of the HSBC group of companies ("HSBC") endorses the contents and/or is
involved in selecting, creating or editing the contents of the Week in China website or the Week in China magazine. The views expressed in these
publications are solely the views of ChinTell Limited and do not necessarily reflect the views or investment ideas of HSBC. No responsibility will
therefore be assumed by HSBC for the contents of these publications or for the errors or omissions therein.